On Bauer Business Focus – A conversation on corporate tax inversions with Houston Public Media News 88.7 Business Reporter Andrew Schneider.
Associate Professor of law, Bret Wells stopped by Bauer Business Focus to discuss organizations incorporating a company overseas in order to reduce the tax burden on income earned abroad.
“Inversions fundamentally represent U.S. companies saying ‘I want to obtain the same earning-stripping opportunities and the same tax-reduction opportunities that my foreign based competitors have,’” Wells said. “It’s that observation that should cause Congress and the public to be outraged and to want fundamental tax reforms so that we don’t have a different set of rules for foreign based companies than for U.S. based companies.”
Wells stated that Congress has previously and unsuccessfully attempted to stop companies from becoming foreign-based companies in order to receive tax reductions.
“To solve the problem what we need prevent is any company to be able to earn U.S. territorial profits and pay a significantly lower tax on those profits because they are a foreign-based company,” Wells said. “So what we would need to do is to have a fundamental reform that prevents the earning stripping techniques that current law affords to all foreign based multinational inbound investors.”
To hear the full story, click here.